News

Record £100m divorce settlement

July 23, 2010

Oligarch and wife Galina only lived together for two years
Ruling cements London as divorce court of choice for rich

He has survived several assassination attempts, false charges of fraud by the Russian authorities and won high-profile libel cases in London courtrooms. But the exiled Russian oligarch Boris Berezovsky has been unable to escape the wrath of his second wife, Galina.

Today she won a divorce from the businessman in the high court, in a settlement that lawyers believe could be the biggest in British legal history.

Berezovsky, who will not contest the case, is expected to pay his second wife anything up to £100m, say reports, which would be more than double the previous divorce settlement record of £48m.

The couple were married for 18 years and had two children together, although they have been separated since the mid-1990s. In divorce papers, Galina describes herself as a “housewife”.

She lives with their teenage children in Kensington, west London, in a penthouse overlooking Hyde Park, while he lives in the 172-acre Wentworth Park estate in Surrey he shares with his girlfriend of 15 years, Yelena Gorbunova, whom he now plans to marry, and their two children.

Berezovsky’s fortune, built up after he separated from his second wife, was once estimated at more than £1bn. Aside from the £10m Surrey estate he bought from the radio DJ Chris Evans in 2004, he reportedly owns a house in Cap d’Antibes in southern France where his 86-year-old mother lives, and a £60m villa at Cap Ferrat, also on the French Riviera.

The pair are separating because of 64-year-old Berezovsky’s “unreasonable behaviour”, say court papers.

The last big payout was awarded to the wife of insurance tycoon John Charman, in 2007. Beverley Charman, his wife of 28 years, won £48m of £131m in assets.

Frank Arndt, a lawyer at Stowe Family Law, which specialises in big money divorces, said: “The starting point in a long marriage, such as the Berezovsky case is equalisation or 50:50 split of all matrimonial assets. This is all the capital created in a marriage, including all savings and pensions.

“The Berezovskys were married for 18 years, have two teenage children and, though estimates of the couple’s fortune vary, it is indeed likely that any settlement eventually awarded to Mrs Berezovsky will dwarf the £48m awarded to Beverley Charman.”

Arndt said Berezovsky may use what is known in the legal profession as the “stellar or genius” argument used by Charman, in which he said his wife had made no financial contribution to the fortune he had built up in the insurance market during their marriage. His case resulted in a discount from the 50:50 position: a high court judge ruled Charman should have 63.5% of the couple’s wealth rather than half because of his special contribution to building it up and because the assets he was keeping were riskier than those which went to his wife.

” It is difficult to speculate what the husband and wife teams would have argued in the Berezovsky case but she will come out of this very wealthy. At one point his fortune was estimated at £1bn and 37% of that is £370m.””However, the biggest challenge facing Mrs Berezovsky might not be the size of the eventual settlement, but how the payment of that settlement can be enforced. This is a question that has been exercising family judges of late, and much can depend upon the locations in which the couple’s assets are held.”

Lawyers say that in cases of the very wealthy, who claim several residences around the world, they advise such clients to file for divorce quickly in London.

The couple met in 1981 when Berezovsky was a professor of mathematics in Moscow earning £60 a month.

He later moved into the used car business, founding the first Mercedes dealership in the old Soviet Union, before becoming one of the original Russian oligarchs when President Boris Yeltsin sold off state assets to favoured supporters. Berezovsky picked up Sibneft, a newly created oil firm and also became the main shareholder in the country’s main television channel, ORT, which he turned into a propaganda vehicle for Boris Yeltsin in the run-up to the 1996 presidential election.

He married Galina in 1991 after divorcing his first wife, Nina, with whom he has two further children.

Lord Bell, Berezovsky’s spokesman, said yesterday there would be no appeal. He has previously confirmed that the businessman was intending to marry Gorbunova when the divorce was finalised.

“The divorce is settled. Uncontested. That’s it. They haven’t lived together for over 15 years.”

Split decisions

Multimillionaire John Charman described as “grotesque” his wife’s record-breaking £48m settlement in 2006 and said he had been penalised for the 15 unhappy years he had spent with her for the sake of their sons.

Madonna reportedly reached a £50m settlement with Guy Ritchie after their 2008 divorce. But sources close to him cast doubt on the figure.

Heather Mills was awarded £24.3m in her divorce settlement with Sir Paul McCartney in 2008. The judge ruled that McCartney was worth £400m. Mills had put his fortune at twice that.

Phil Collins paid his third wife, Orianne Cevey, £25m when their six-year marriage ended in 2008.

Stowe Family Law LLP is authorised and regulated by the Solicitors Regulation Authority. SRA ref 469401.
Stowe Family Law LLP is registered with Companies House, ref. OC331570, and registered for VAT, number 918 5722 04.
Calls may be recorded for quality and training purposes.